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Libyan rebels imposing siege to one of Muammar Gaddafi's remaining strongholds claimed surrender negotiations have collapsed and they are ready to attack.

Thousands of rebel fighters are surrounding Bani Walid. According to them, rebels said they had tried to negotiate a peaceful surrender, but accused Bani Walid tribal leaders of stalling.

A rebel commander, Mohammed al-Fassi, said "the negotiations are over". Rebels have said they will launch their assault later on Sunday.

Meanwhile, it is reported that about 50 bodyguards of Colonel Muammar Gaddafi, managed to escape and sneak into the southern region of Algeria near the border with Libya. According to an Algerian daily, some 12 luxury cars carried the bodyguards and members of their family.

The Algerian authorities prevented some vehicles to enter their territory forcing them to head towards the border with Niger, according to the newspaper.

In a related development, Algerian sources said at least four of Gaddafi's personal bodyguards found dead in an area not far from the Algerian border. The newspaper pointed out that the victims were shot when they were on their way to escape towards the Algerian territory.